In each blank next to the following types of indirect expenses and service department expenses, place the identifying letter of the best allocation basis to use to distribute it to the departments indicated. 1. Computer service expenses of production scheduling for operating departments. 2. General office department expenses of the operating departments. 3. Maintenance department expenses of the operating departments. 4. Electric utility expenses of all departments. A. Relative number of employees. B. Proportion of total time in each department for maintenance. C. Proportion of floor space occupied by each department. D. Proportion of total processing time for each operating department.

In each blank next to the following types of indirect expenses and service department expenses, place the identifying letter of the best allocation basis to use to distribute it to the departments indicated. 1. Computer service expenses of production scheduling for operating departments. 2. General office department expenses of the operating departments. 3. Maintenance department expenses of the operating departments. 4. Electric utility expenses of all departments. A. Relative number of employees. B. Proportion of total time in each department for maintenance. C. Proportion of floor space occupied by each department. D. Proportion of total processing time for each operating department.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter5: Support Department And Joint Cost Allocation

Section: Chapter Questions

Problem 5DQ: How does management determine the order in which support department costs are allocated under the...

See similar textbooks

Similar questions

For each of the following expenses, select the best allocation basis. A. Value of insured assets. B. Square feet of space occupied. C. Proportion of total purchase orders for each operating department. D. Number of employees in department. Maintenance department expenses of the operating departments. Payroll department expenses of all departments. Purchasing department expenses for the operating departments. Insurance expenses of all departments.
For each of the following expenses, select the best allocation basis. A. Value of insured assets. B. Proportion of total purchase orders for each operating department. C. Square feet of space occupied. D. Number of employees in department. Insurance expenses of all departments. Personnel department expenses of all departments. Purchasing department expenses for the operating departments. Maintenance department expenses of the operating departments.
Which of the following bases is the most appropriate for the appointment of rent and rates expenses? Relative floor area of departments Number of employees in the department Technical estimation Horsepower rating ratio
[The following information applies to the questions displayed below.] National Retail has two departments, Housewares and Sporting. Indirect expenses for the period follow. Rent Advertising Insurance Total $ 45,000 25,000 10,000 $ 80,000 The company occupies 4,000 square feet of a rented building. In prior periods, the company divided the $80,000 of indirect expenses by 4,000 square feet to find an average cost of $20 per square foot, and then allocated indirect expenses to each department based on the square feet it occupied. The company now wants to allocate indirect expenses using the allocation bases shown below. Department Housewares Sporting Total Square Feet 1,440 2,560 4,000 Sales $ 370,000 130,000 $ 500,000 Value of Insured Assets $59,000 41,000 $ 100,000 Required: 1. Allocate indirect expenses to the two departments using the allocation method used in prior periods.
In each blank next to the following types of indirect expenses and service department expenses, place the identifying letter of the best allocation basis to use to distribute it to the departments indicated.
Q. Allocate the service department costs to the two operating departments using(i) the step-down method (Allocate Administrative Services first)(ii) the step-down method (Allocate Maintenance Services first)
Current Attempt in Progress Dr. Kimberly is evaluating her dental practice with her colleague, Dr. Matthew. Dr. Kimberly provides general dental services, while Dr. Matthew provides orthodontic care. They utilize shared business services (including human resources, billing, and purchasing) as well as shared maintenance services. Here is a summary of their costs and usages, where business services are allocated based on hours on task and maintenance costs are allocated based on square feet of space. Original cost Business services (proportion of time spent) Square feet of space (proportion of space used) Business Services $90,000 0.20 Maintenance Dental $56,000 $554,000 0.05 0.55 0.50 Orthodontics $386,000 0.40 0.30 Vi Ac
Suggest a reasonable basis for allocating each of the following indirect expenses to departments: (a) salary of a supervisor who manages several departments, (b) rent, (c) heat, (d) electricity for lighting, (e) janitorial services,( f ) advertising, (g) expired insurance on equipment, and (h) property taxes on equipment.
Rank the support departments based on the percentage of their services provided to other support departments. Use this ranking to allocate the support departments’ costs to the operating departments based on the step-down method.
Required: Rank the support departments based on the percentage of their services provided to other support departments. Use this ranking to allocate the support departments’ costs to the operating departments based on the step-down method.
For each of the following costs, indicate whether the amount is a direct or indirect cost of the equipment maintenance department. Also indicate whether each cost is at least partially controllable by the departmentsupervisor.1. Cost of plant manager’s salary, which is allocated to the maintenance department.2. Cost of property taxes allocated to the maintenance department.3. Cost of electricity used in the maintenance department.4. Depreciation on the building space occupied by the maintenance department.5. Idle time of maintenance department employees.
18. Which of the following would be an appropriate allocation base for support department costs associated with an accounting department? a. Number of accounting transactions processed b. Number of purchase requisitions prepared c. Square footage of the office space occupied by accounting d. Number of units of product sold